Value-based price benchmarks can help payers determine whether a drug’s price aligns with its ability to help patients, which can then facilitate the innovation and uptake of new therapies, said Steve Pearson, MD, MSc, president of the Institute for Clinical and Economic Review (ICER).

Value-based price benchmarks can help payers determine whether a drug’s price aligns with its ability to help patients, which can then facilitate the innovation and uptake of new therapies, said Steve Pearson, MD, MSc, president of the Institute for Clinical and Economic Review (ICER).

Transcript (slightly modified)

What role does the value-based price benchmark play when judging the affordability and value of a therapy?

In our system, where we do have sometimes insurers saying that they’re not going to cover something, but that’s on the basis of the clinical information they have, most of the time. Sometimes, they do feel that 2 treatment options would be similarly effective and one is much more expensive, and they might only cover the one that’s less expensive.

On the other hand, our system could be based more on linking the added benefit to patients to the price that we are willing to pay. So, the issue is not whether we will or won’t cover it as part of insurance; it is, we will cover it but at what price? What is the price that would align best with the ability to help patients, which is really what I think we ought to anchor pricing to in our healthcare system.

That’s what the ICER value-based price benchmark does. It begins the discussion, it creates a way to think transparently and consistently across different treatment areas about how we would line up that price with the benefit to patients, because ultimately the goal is to say that if we can get the pricing aligned appropriately, we should be able to have a system that is much more accommodating to innovation, to new treatments, because at a value-aligned price, we want to facilitate uptake. We want to facilitate use, and get the benefits for as many patients as should be appropriately treated.